Tata Motors Q4 net profit falls, but beats forecasts

MUMBAI: India’s top automaker Tata Motors saw its net profit in the fourth fiscal quarter fall 36.7 percent, but still managed to beat forecasts amid shrinking domestic demand, the firm said.
Consolidated net profit for Tata Motors, including its Jaguar and Land Rover brands, slipped to 39.45 billion rupees ($ 704 million) for the three-month period ending in March from 62.34 billion rupees in the same period in 2012.
The company still recorded profits higher than the consensus market forecasts of 28 billion rupees.
Revenues of Tata Motors, part of the giant steel-to-software Tata Group now controlled by new chairman Cyrus Mistry, rose ten percent to 560 billion rupees during the quarter.
This was despite a “weak operating environment in the standalone (India) business, which was more than offset by strong demand and growth in volumes” at Jaguar-Land Rover (JLR), the company said in a statement.
Net revenue for the JLR brands rose nearly 22 percent to 5.05 billion pounds ($7.61 billion) for the quarter, but net profit nearly halved to 378 million pounds ($ 569 million), from levels a year earlier.
Tata Motors, which is also the maker of the world’s cheapest car, the Nano, bought Jaguar and Land Rover from Ford Motor Co. in 2008 for $ 2.3 billion as part of plans to expand its reach beyond Asia.
The deal vaulted Tata Motors from a commercial vehicle and small-car maker into a global player with luxury brands in its range of offerings.
Tata Motors’ business in India showed a loss of 3.12 billion rupees for the past quarter, from a profit of 5.65 billion rupees a year earlier.
Demand for new cars is slowing rapidly in India, with April sales marking the longest ever stretch of monthly declines for the country’s once red-hot car market.
Domestic passenger car sales — a reflection of overall economic health — fell by 10.43 percent to 150,789 vehicles in April from the same month a year ago.
High borrowing costs, worries over a sharp slowdown in the economy and costly fuel prices have kept buyers out of showrooms.
sal/amu/ia